{{$store.state.data.search.serverData.config.placeholder}}

{{ vm.heading }}

{{ vm.closeTabLabel }}

Notice of updates
!

Since the last time you logged in our privacy statement has been updated. We want to ensure that you are kept up to date with any changes and as such would ask that you take a moment to review the changes. You will not continue to receive KPMG subscriptions until you accept the changes.

Hi
!

Our privacy policy has been updated since the last time you logged in

We want to make sure you're kept up to date. Please take a moment to review these changes. You will not receive KPMG subscription messages until you agree to the new policy.

Close

Hi!

Notice 2018-57: Regulations under section 987, one-year deferral

U.S. regulations under section 987, one-year deferral

The IRS today released an advance version of Notice 2018-57 announcing that the U.S. Treasury Department and IRS intend to amend the regulations under section 987 to defer the applicability date of the final regulations under section 987, as well as certain related final and temporary regulations, by one additional year.

Related content

In December 2016, Treasury and the IRS released three sets of regulations—final, temporary, and proposed regulations—concerning the taxable income or loss of a taxpayer with respect to a “qualified business unit” (QBU) subject to section 987. Read TaxNewsFlash

Subsequently, the final regulations under section 987 were identified by Notice 2017-38 as “significant tax regulations” requiring additional review pursuant to Executive Order 13789. As part of that review, today’s notice states that Treasury and the IRS are considering changes to the final regulations that would allow taxpayers to elect to apply alternative rules for transitioning to the final regulations and alternative rules for determining section 987 gain or loss.

Notice 2018-57 provides that the final regulations and related temporary regulations will apply to tax years beginning on or after the date that is three years after the first day of the first tax year following December 7, 2016 (the amended applicability date). Thus, following the amendments, for a taxpayer whose first tax year after December 7, 2016, began on January 1, 2017, the final regulations would apply for the tax year beginning on January 1, 2020. A taxpayer may elect to apply the final regulations and the related temporary regulations to a tax year beginning after December 7, 2016 (subject to certain conditions) and before the amended applicability date.

Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.

The KPMG logo and name are trademarks of KPMG International.
KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever.
The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.